RESTRICTED  WORLD TRADE  
ORGANIZATION  G/STR/M/15 
22 February 2006 
 
 (06-0754) 
Working Party on State Trading Enterprises  
  
 
MINUTES OF THE MEETING OF THE WORKING  
PARTY ON STATE TRADING ENTERPRISES 
HELD ON 26 JANUARY 2006 
 
Chairperson: Mr. Benjamin Katjipuka (Namibia
) 
 
Page   
A.
 ADOPTION OF THE AGENDA .........................................................................................................1  
B. REVIEW OF NEW AND FULL NOTIFICATI ONS SUBMITTED BY MEMBERS UNDER 
G/STR/N/10  IN ACCORDANCE WITH THE RECOMMENDATION CONTAINED IN G/STR/5.............1  
C. REVIEW OF NEW AND FULL NOTIFICATI ONS SUBMITTED BY MEMBERS UNDER 
G/STR/N/4  & 7 AND UPDATING NOTIFICATIONS SUBMITTED BY MEMBERS UNDER 
G/STR//N/5,  6, 8 AND 9...............................................................................................................4  
D. OTHER BUSINESS .........................................................................................................................5  
1. Chairman – Annual Report (2006) of the Working Party to the Council for 
Trade in Goods................................................................................................................. .........5  
2. Chairman – Date of the next regular meeting of the Working Party in 2006 .....................5  
 
 A. 
 ADOPTION OF THE AGENDA  
1. The Chairman  referred to the proposed agenda contained in document WTO/AIR/2738 
circulated on 16 January 2006 and reiterated that memb ership in this Working Party is open to all 
Members of the WTO indicating their wish to serve on it.  
2. The Chairman  indicated that he would make two announcements under "Other Business" 
regarding the Annual Report (2006) of the Working Party on State Trading Enterprises to the Council 
for Trade in Goods, and the date of the next regular  meeting of the Working Party in the fall of 2006. 
3. The Working Party adopted  the agenda contained in WTO/AIR/2738, as amended. 
B. REVIEW OF NEW AND FULL NOTIFICATI ONS SUBMITTED BY MEMBERS UNDER G/STR/N/10  IN 
ACCORDANCE WITH THE RE COMMENDATION CONTAINED IN G/STR/5 
4. Before starting the substantive discussions  under this agenda item, the Chairman  made a 
statement regarding the review of notifications subm itted by Members at this meeting.  The Chairman 
recalled that, according to paragraph 5 of the Unde rstanding on the Interpretation of Article XVII of 
GATT 1994, the Working Party is tasked to review  the notifications and counter-notifications 
submitted by Members on their state trading enterprises and, in light of this review, the Council for 
Trade in Goods may make recommendations with regard  to the adequacy of notifications and the need 
for further information.  G/STR/M/15 
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  5. He suggested that the Working Party conduct this review in the same manner as that used for 
the review of notifications at previous meetings , that is, with a focus on two main elements:  
(i) whether the notification responds adequately to  the information requested in the questionnaire 
contained in G/STR/3/Rev.1;  and (ii) whether more information is needed in order to permit – in the 
language of paragraph 2 of the U nderstanding – "a clear appreciation of the manner of operation of 
the enterprises notified and the effect of  their operations on international trade". 
6. The Chairman
 also recalled that, at its meeting of  20 February 1995, the Council for Trade in 
Goods established a deadline of 30 June 1995 for ne w and full notifications by Members on their state 
trading enterprises, and that the Working Party sub sequently agreed to maintain 30 June of each 
respective year as the date for all further notifi cations.  On 11 November 2003, the Working Party 
adopted the recommendation contained in G/STR/5 re garding the frequency of notifications.  The said 
recommendation, approved by the Council for Trad e in Goods on 26 November 2003, modified the 
periodicity of state trading notifications so that  new and full notifications on state trading are due 
every two years instead of every three years and that the requirement of updating notifications in the intervening years is eliminated. 
7. Accordingly, the Chairman
 suggested that the review of Members' notifications be carried out 
under two separate agenda items.  Agenda item "B" which deals with  the new and full notifications 
submitted by Members under G/STR/N /10 dated 17 February 2004 in accordance with the  
recommendation contained in G/STR/5 ; and agenda item "C " relating to the review of new and full 
notifications submitted by Members under G/ STR/N/4 & G/STR/N/7 dated 22 April 1998 and 
26 February 2001 respectively, as well as the upda ting notifications submitted by Members under 
G/STR/N/5, 6, 8 and 9 dated 10 March 1999, 1 Marc h 2000, 20 February 2002 and 21 February 2003 
respectively.  These notifications, required of all  WTO Members, were due by 30 June of the 
respective years.  
8. The Chairman  reminded Members that as agreed at the Working Party's meeting in 
September 1996, notifications that have already b een reviewed and on which there may be written 
questions will not  be retained on the airgram for the Working Party's next meeting unless  a Member 
specifically so requests.  
9. The Working Party then proceeded  with the review of the new and full notifications 
submitted by Members under G/STR/N/10. 
10. No questions were posed regarding the notification of Albania  (G/STR/N/10/ALB). 
11. No questions were posed regarding the no tification of Former Yugoslav Republic of 
Macedonia   (G/STR/N/10/MKD). 
12. No questions were posed regarding the notification of Moldova  (G/STR/N/10/MDA/Corr.1). 
13. Regarding the notification  of  New Zealand  (G/STR/N/10/NZL), the representative of the 
European Communities  inquired if any "exclusive or special rights or privileges, including statutory 
or constitutional powers" or parts thereof, referre d to in Paragraph 1 of the Understanding on the 
interpretation of Article XVII of the GATT 1994, held by the New Zealand Dairy Board, were 
transferred to any other non-governmental en terprise in New Zealand; whether such non-
governmental enterprise had been executing such ri ghts or privileges or parts thereof; and what 
measures the government would be preparing or taki ng to discontinue the granting of such rights or 
privileges.1   
                                                      
1 G/STR/Q1/NZL/4.  G/STR/M/15 
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  14. The representative of New Zealand  mentioned that she received the questions orally the day 
before the meeting and only orally at the meeting, a nd that she would answer the questions to the best 
of her ability.  She stated that New Zealand did not  believe that there were any exclusive rights or 
privileges referred to in the Understanding that would require the notification of any New Zealand 
dairy entity as a state trading enterprise. 
15. The representative of the European Communities  inquired whether New Zealand would 
intend to elaborate further in the future , and the representative of  New Zealand  requested the written 
version of the questions to be able to provide a follow-up on its answers.  
16. No questions were posed regarding the notification of Peru  (G/STR/N/10/PER). 
17. No questions were posed regarding the notification of Qatar  (G/STR/N/10/QAT).  
18. No questions were posed regarding the notification of Romania  (G/STR/N/10/ROU). 
19. No questions were posed regarding the notification of Uganda  (G/STR/N/10/UGA). 
20. On the notification of the United States  (G/STR/N/10/USA), the representative of Australia  
stated that the United States provided some information on financing of the Commodity Credit Corporation (CCC) operations.  In particular, he noted that the CCC might borrow funds from the US 
Treasury at the average interest rate of all outst anding marketable obligations.  He requested the 
United States to provide information on the other co nditions of such borrowings, for example the term 
of the loan.  
21. The representative of Australia
 also noted that interest might al so be paid at a rate prescribed 
by the CCC on borrowings other than from the US Treasury, and inquired if the United States could explain how the rates prescribed by the CCC itself were  set,  whether such rates were based on market 
interest rates, and elaborate on the terms of these loans.  
22. The representative of Australia
 expressed his delegation's appr eciation to the United States for 
the information provided in G/STR/Q1/USA/8 in res ponse to Australia's questions previously posed 
in this regard, and the United States' comment that  possible future disciplines on food aid were under 
discussion in the Committee on Agriculture.  However,  the representative of Australia indicated that 
the CCC was indirectly involved in export sales th rough the donation of the CCC stocks to other 
governments, private voluntary organisations, and US cooperatives which were s ubsequently sold into 
commercial market as food.  He added that in 2004, Australia sought data on the quantity and value of 
the CCC stocks that were sold in that manner and c onsidered that this question was directly relevant 
in the context of examination of the United States STE notification as it related to the CCC 
involvement in export sales.   
23. Furthermore, the representative of Australia  noted that the United States previously responded 
to a question from Australia that the Capper-Volstead Act had no specific relation to import or export 
markets.  Australia realized, however, that the US agricultural cooperatives that benefit from the 
exemption from anti-trust laws afforded by the Capp er-Volstead Act were involved in trading.  The 
representative of Australia requested the United St ates to explain why it would consider that the 
antitrust exemption that agriculture cooperatives ge t domestically was not a “special privilege” that 
would impact on their trading activities within the meaning of Article XVII. 
24. The representative of Australia  also emphasized that the United States confirmed in its 
response that the Capper-Volstead Act itself prohibited a cooperative from monopolizing or G/STR/M/15 
Page 4  
 
  restraining trade "to such an extent that the pri ce of any agricultural product is unduly enhanced", and 
requested the United States to explain how this prohibition would work in practice.
2    
25. Also, on the notification of the United States  (G/STR/N/10/USA), the representative of the 
European Communities  inquired about the involvement of the US' Government in the export 
financing activities of the CCC and its means of ass essing any potential trade-distorting effects in this 
regard.3   
26. The representative of the United States  indicated that, as he only received an advance notice 
of the questions on the day before the meeting, he was not in position to provide a substantive 
response to the questions.  He promised to forwar d the questions to Washington for review by the 
appropriate authorities and would keep the Work ing Party posted of the responses.      
27. The representative of Australia  requested that the notification of the United States contained 
in document G/STR/N/10/USA be retained on the airg ram of the next meeting of the Working Party. 
28. The representative of China  requested a written copy of the questions posed by Australia to 
the United States and the Chairman  indicated that the Secretariat would circulate these questions as a 
WTO document.      
C. REVIEW OF NEW AND FULL NOTIFICAT IONS SUBMITTED BY MEMBERS UNDER G/STR/N/4  & 7 
AND UPDATING NOTIFICAT IONS SUBMITTED BY MEMBERS UNDER G/STR//N/5,  6, 8 AND 9    
29. The Working Party proceeded with the review  of new and full notifications submitted by 
Members under G/STR/N/4 & 7 and updating notifica tions submitted by Members under G/STR/N/5, 
6, 8 and 9.   
30. No questions were posed regarding the notification of Moldova  (G/STR/N/9/MDA/Corr.1). 
31. No questions were posed regard ing the notifications of Peru  (G/STR/N/4/PER & 
G/STR/N/5/PER & G/STR/N/6/PER & G/STR/N/7 /PER & G/STR/N/8/PER & G/STR/N/9/PER). 
32. In light of the fact that some delegations were not able to respond fully to the questions raised 
on their respective notifications at the meeting, the Chairman  invited delegations that  raised questions 
to submit these in writing directly to the Member concerned, with a copy to the Secretariat for 
circulation.  The Chairman also invited the dele gations, that raised questions and received oral 
responses at the meeting and wish to have writte n responses, to submit the questions in writing 
directly to the Member concerned, with a copy to the Secretariat for circulation.  The Chairman noted 
that written responses to all written questions should be submitted directly to the inquiring country, 
also with a copy to the Secretariat, as soon as possible. 
33. The representative of Australia  inquired whether it was a standard practice in the Working 
Party for the Chairman to set par ticular deadlines for the submission  of written answers to the written 
questions posed with respect to the notifications of Members. 
34. The Chairman  explained that, as a standard practice,  the Chairman would not set a specific 
deadline for the receipt of the answers, but would always urge the Members concerned to provide the 
responses as soon as possible.      
                                                      
2 G/STR/Q1/USA/10. 
3 G/STR/Q1/USA/9.  G/STR/M/15 
 Page 5 
 
 
  35. The representative of the European Communities , while acknowledging certain delays in the 
notification process, made an announcement in whic h he confirmed that the European Communities 
would soon notify the Working Party, on behalf of its 25 Member States, that it no longer maintained 
any state trading enterprises.  
D. OTHER BUSINESS  
1. Chairman – Annual Report (2006) of the Wo rking Party to the Council for Trade in 
Goods 
36. The Chairman  recalled that he had reported, on hi s own responsibility, to the Council for 
Trade in Goods that the Working Party did not meet in 2005 and that it postponed its meeting until 26 January 2006 in the light of the intensification of the negotiations prior to the Sixth Ministerial 
Conference in Hong Kong and the statement by the Chairperson of the General Council in July 2005 
suggesting the reduction of the work of regular bodies to essential business only, to allow Members to 
focus their resources on the negotiating bodies.  He adde d that his report in this concern is contained 
in document (G/L/749) dated 18 October 2005.  As regards the Working Party's Annual Report (2006) 
to the Council for Trade in Goods, he indicated that the Secretariat would prepare a draft report on the 
Working Party's activities which would be made ava ilable to Members shortly, prior to the next 
meeting of the Working Party in the fall.  The said draft report and its annex would reflect the activities of the Working Party since the Chairman's last report in October 2005.  
2. Chairman – Date of the next regular meeting of the Working Party in 2006 
37. The Chairman
 proposed that the next regular meeting of the Working Party be held on 
Thursday, 12 October 2006.  The last date for the inscription of items on the agenda will be Thursday, 
28 September 2006 by close of business.  The ai rgram convening the meeting will be issued on 
Monday, 2 October 2006. 
38. The meeting was adjourned . 
__________